Imagine a healthcare system that looks like single payer on the surface, but where the government issues cash payments to citizens allowing them to purchase services directly from health providers. This idea is being floated by former Tennessee governor and health insurance executive, Philip Bredesen, in his book, Fresh Medicine. Los Angeles Times business columnist David Lazarus, who has written in support of single payer in previous columns, describes Bredesen’s plan:
In his book, “Fresh Medicine,” he argues that a key element of meaningful healthcare reform is creation of a Social Security-like trust fund that would raise money from payroll taxes and issue vouchers to all Americans.
Those vouchers would be used as cash to buy services directly from healthcare providers. Private insurers as intermediaries would largely disappear.
Bredesen rightly believes that President Obama’s federal health reform law won’t do enough to address the cost problem. He says his plan would rein in costs by making doctors and patients more careful about how much they are spending on treatment.
Vouchers are typically associated with conservative education reform efforts that promote giving poor children public funds to attend private schools. Critics of school vouchers contend that the idea only drains resources away from the public schools. You may or may not believe vouchers for schools have merit, but vouchers for health care don’t seem to me to be workable at all. Lazarus points out some potential problems with Bredesen’s idea: that a healthcare trust fund could run out of money, requiring either an increase in payroll taxes or reduction in benefits; that the cost of treatment for some ailments could cost more than the voucher; that doctors could end up practicing “McMedicine.”
I’m glad the former governor wants to sharply curtail the influence of the private insurance industry. But government-issued vouchers for basic services really make no sense. We either pay for the services we need – and health care is a service – through general taxation, or we individually pay for them out of our own pockets. We don’t issue vouchers to citizens to purchase police and fire protection. We don’t apply to the government for a coupon to use the library or go to the park. These services are provided automatically as part of the commons. Health care should be considered part of the commons – something we pay for collectively as a society. Comparing health care with Social Security is not a perfect analogy. Not everyone is eligible for Social Security, like certain public employees. But everyone is entitled to using roads, parks, police and fire. Health care should be treated the same way. Another question for Bredesen is that since his plan is funded primarily through payroll taxes, are you only eligible for the voucher if you have a job? What about people who are unemployed or self-employed? And, would people get separate vouchers for prescription drugs?
The problem is, a voucher system for health care still treats medical care as a commodity and patients as consumers. It seems like a cop-out. It looks similar to a government-run healthcare system, but one that still forces individuals to operate in the free market. “Single payer” means that the government is the sole funder; why split the pot into 300 million individual funders? In a single payer system, the government has the clout to negotiate with health providers on fees, thus driving down costs. Handing patients a voucher would force them to have to do the bargaining on an individual basis, and waste time comparing provider rates to make sure they don’t pay more than the voucher is worth. Who needs that kind of headache, when all you want is to get treated? And I don’t think someone having a heart attack should be forced to wonder whether his voucher would be better spent at the hospital 5 miles away or the one 10 miles away.
A true single payer system like California OneCare, which doesn’t rely on vouchers, issues each resident a medical card. This card enables a patient to go into a doctor’s office, get treated, and go on his or her merry way. That’s it. The patient leaves payment up to the state and the provider. It’s much simpler that way than having an agency dole out $100, $1,000 or $5,000 coupons per person upfront when it’s not necessarily known how much care an individual will need over his or her lifetime. Imagine the paperwork involved for the patient if she needed to apply for another voucher because she suddenly got diagnosed with cancer. It could end up being a bureaucratic nightmare. Setting up a healthcare system based on vouchers doesn’t seem terribly efficient in the long run.